Good evening and welcome to NIQ's second quarter 2026 earnings conference call. This call is scheduled to last approximately one hour. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. With that, I'd like to turn the call over to Will Lyons, head of investor relations. Please go ahead.

Thank you. Hello everyone and welcome to NIQ's second quarter 2026 earnings call. Joining me today are CEO Jim Peck and CFO Mike Burwell. Following Jim's and Mike's prepared remarks, we'll open the line for Q&A with Jim, Mike, and our Chief AI and Product Officer Troy Triangan. As a reminder, today's remarks will include forward-looking statements regarding our expectations and outlook. Actual results may differ materially from those expressed or implied in these statements. For information about factors that could cause actual results to differ materially, please refer to today's earnings press release and our SEC filings. We undertake no obligation to update any forward-looking statements made on this call except as required by law. During this call, we will also discuss both GAAP and non-GAAP financial measures. Reconciliations of non-GAAP measures to the most directly comparable GAAP measures are included in our earnings press release, which is available on our investor relations website. A replay of this call will also be available there. And finally, unless otherwise noted, revenue growth rates mentioned on this call are compared with prior year period. And with that, I'll turn the call over to Jim.

Thank you, Will. Good afternoon, everyone. Before we begin, I just want to apologize. I have a cold and so I'm sure my voice is a little bit raspy and we'll just do the best we can. Q2 marked our fifth consecutive quarter, exceeding the top end of our guidance across all key metrics. We accelerated organic constant currency revenue growth to 5.8%, grew adjusted EBITDA nearly 22%, and expanded adjusted EBITDA margin 270 basis points to 23.3%. Adjusted earnings per share came in at 27 cents, well above the top end of our range. Levered free cash flow inflected positive at 74.1 million, and we reduced leverage to 3.1 times. That's progression from top to bottom line. We are raising full year 2026 guidance across the board, reflecting our upside performance and positive outlook. It's been a year since our IPO and several things stand out. Strong demand for our solutions, our structural advantages, and our strengthening financial profile, including Durable growth and retention with 10 consecutive quarters of 5% plus growth in organic constant currency and strong Q2 retention at 105% NDR and 99% GDR. This is a strong core with emerging AI growth opportunities. We're also seeing expanded margins approaching our mid-20s target with a longer term path into the 30s. Increased profitability tracking to more than a billion of adjusted EBITDA and more than a dollar of adjusted EPS this year. Inflecting cash flow and a raise outlook for $245 million to $255 million. And continue deleveraging on track to achieve our sub three times target. We're delivering results today while reinvesting in competitive differentiation and our future. AI native innovation, consumer panel expansion, technology platform enhancements, and discipline tuck in M&A. As I've described on our recent calls, NIQ sits on one of the world's most defensible data assets in our view. Decades of permission harmonized data and vertical specific context layer across consumer, retail and market intelligence. We believe that combination is impractical, if not impossible to replicate. Last quarter, I outlined how NIQ intelligence drives client decision making and how AI adoption is creating additional growth opportunities. Today, it's about progress we're making on our innovation roadmap. Optic, Bridge and Connect AI deliver NIQ intelligence The balance of my remarks today will cover three areas. How a broadly healthy client demand environment is driving our core growth. Second, our progress laying the foundation for additional AI-powered growth. And third, our progress expanding profitability by embedding AI across our organization. On point one, clients are buying more NIQ. Looking at our regions, America's OCC growth led the way, growing 8.3%. EMEA OCC growth accelerated to 4.9%. In both, we saw new wins and strong upselling of our intelligent solutions. In the US, a leading coffee manufacturer consolidated onto NIQ from two encumbered providers at once. They told us why, our AI capabilities and product roadmap, as well as the seamless unified full view experience across every data set. In EMEA, leading Swiss and UK grocers paired measurement with consumer panel to get the full view. and a major UK grocer came back to us from a competitor on that same value proposition, choosing our new product granularity and e-commerce expertise. APAC returned to 1.9% OCC growth. Here we saw strong activation, cross-sell and early improvement in China, Japan and Korea from the retailer relationships and partnerships we outlined last quarter. In Vietnam, we won back a global CPG manufacturer from a competitor mid-pilot by designing a tailored measurement plus field solution in weeks, not quarters. That is the pattern across the region. We start with granular measurement data, then expand into analytics to power go-forward decisions. We also beat two major global incumbents to win the largest going global contract in that market to date, helping a major automaker expand overseas. We also recently acquired Yimions, and e-commerce data and insights business in China and Southeast Asia. It strengthens our digital commerce capabilities, accelerates the full view, and extends NIQ into adjacent opportunities like agentic commerce in these markets. We also opened new categories and buyer types that were not NIQs a couple of years ago. A global ad tech platform licensed our purchase data to power privacy safe campaign planning at scale, selecting NIQ over a direct competitor and traditional panel providers. Unlimitail, a leading European retail media platform, chose NIQ to measure business outcomes across its multi-retailer, multi-country network, our first client of its kind. Ad tech and retail media, our newer adjacent demand pools, prove our data travels well beyond CPG. Growth was not only strong by region, but by product. Q2 Intelligence growth re-accelerated to 5.7% on new wins and strong upselling motion, particularly in e-commerce and consumer panel. And annualized intelligence subscription revenue, our version of ARR, grew 5.8% in Q2 and eclipsed the $3 billion mark. Activation OCC growth accelerated for a second straight quarter to 6.1%, signaling our commercial and go-to-market efforts are working. In North America, a global convenience retailer expanded its renewal into SKU-level analytics, price and promotion, and category management across more than a dozen countries, adding over $5 million of incremental value. In the Middle East, a regional manufacturer layered shopper and consumption analytics onto its core measurement subscription, and we took that work back from a competitor across three markets. and a Global Personal Care Leader extended its worldwide agreement, adding analytics and servicing on top of core measurement. Within Activation, demand remains strong for our analytics and innovation-based solutions. Year-to-date, these solutions were nearly 60% of Activation revenue and grew low double digits. Looking deeper, our AI-native solutions, Basies AI and Retail Activate, drove meaningful share of that growth. This growth isn't a one-off. It's driven by newer AI native offerings that feed directly from our proprietary core data. And that data is growing fast. We added 4.3 trillion consumer transaction data records per week in Q2, 23% faster than last year. This spans 260 million product items with 10.5 billion product attributes in our 160 petabyte data engine, all rooted in NIQ's vertical specific expertise That granularity benefits our entire portfolio. In fact, more than 90% of our revenues derived from this proprietary data and our capabilities are increasingly at the fore as client AI adoption accelerates. Let me share some proof points from our first wave. Data point consumption on our platform grew 25% year over year. Roughly 51% of our top 100 clients now use at least one of our AI native solutions. and the number of clients using them has grown 64% year-to-date. This is also translating into financial results. Revenue from AI-native solutions grew by 34% in Q2 and more than 80% of AI-native revenue comes from recurring clients, a good sign of stickiness and long-term value. Clients are at the center of everything we do and we're focused on doing more. In June, our annual flagship client event, C360, through more than 600 CPD, tech and durables, and retailer decision makers from across the globe, their message was clear. Help them cut through the fragmented data and disconnected systems and decide faster in a fast-changing consumer landscape and help them capitalize on their AI strategies. Which brings me to my second point, our progress laying the foundation for additional AI-powered profitable growth. Last quarter, I described our three-pillar strategy to fuel the future of trusted AI. In Q2 and year-to-date, we accelerated innovation to deliver AI-native value for clients and our business. In our first pillar, Building NIQ AI Applications for Smarter Outcomes, at C360, we announced Optic Suite, our Insight Assistance, and NIQ Cadence, our Gen-I native marketing effectiveness platform. Aligned to our second pillar, NIQ IP that fuels AI, we announced the launch of Optic Bridge and Connect AI Suite, which embed decision-grade NIQ intelligence directly into market-leading applications, AI-powered workflows, and the enterprise. We've also progressed MCP access and integrations with all of the leading AI platforms so clients can reach secure, governed NIQ intelligence directly through these platforms. These launches let us meet clients exactly where they are, Whether they're an AI buyer of NIQ solutions directly or through an LLM or an ad builder embedding NIQ within their own AI environment. Importantly, every solution has permission service layers built in. Clients can embed NIQ intelligence into their AI use cases while keeping the NIQ decoder ring, the IP methodologies and models that power our differentiated analytics. And last week we announced the first charter clients for Connect AI. These include Purina, a global personal hygiene company, a leading beauty company, and two global beverage companies. Each is working with a dedicated NIQ engineering and data science team to build AI-ready intelligence infrastructure and decision workflows inside their own environment. Early client demand has been strong. Our pipeline has grown quickly to 49 live opportunities, including our charter clients and active discussions with many of our top clients. It is also broad based across FMCG and tech and durables as well as with clients large and small. We plan to add more charter clients including retailers in the next phase. We are also in active discussions on several AI partnerships with major players that can accelerate our objectives. These include a partnership leveraging forward deployed engineering expertise to accelerate deployment of optic bridge and discussion with multiple partners around our agentic commerce measurement launch targeted for later this year. And on our third pillar, powering commerce intelligence and agentic commerce, we see a long term growth opportunity. AI is playing a bigger and bigger role in consumer shopping, moving from answering questions to influencing commercial decisions to helping execute them. As that happens, NIQ's granular content on product attributes, availability, pricing, and consumer preferences moves directly into the commerce flow and rises in value. Our capabilities span product intelligence and availability, channel and media measurement, and agentic transaction integration positioning NIQ, we believe, to play an operative role in the next phase of AI-powered commerce. During Q2, we built toward that future. NIQ Commerce Lab is establishing the data, API, and measurement infrastructure for AI-driven commerce. We launched product intelligence, the first offering in our commercial intelligence portfolio. It resolves fragmented product data under a single structured layer. This allows AI commerce systems to accurately identify, compare, and recommend products to drive shopping conversion. Taken together, we believe this wave of AI launches positions us for significant growth. 2026 is a foundation building year, driving early adoption, expanding partnerships, validating monetization models, and scaling our first client implementations. Over time, we look to layer on additional revenue streams, premium AI-ready data, usage-based AI services, AI-native applications like Optic, Bridge, and Connect AI, as well as AI deployment services. While we expect these initiatives to contribute some revenue in 2026, our RAISE 2026 outlook does not assume a material contribution from them. This year is about building. We expect to begin scaling commercially in 2027 and beyond. Leading that effort is Irina Stoyan, who joined us as our Chief AI Commercial Officer in July from Palantir, where she scaled technology and analytics businesses. She's partnering with Troy and the team to drive our next chapter of AI-powered client value, and I look forward to you meeting her in the future. So our core revenue base is strong and we're building AI value on top of it. Which brings me to my third point, the benefits of AI led operating efficiency. AI is accelerating our ability to build, deliver and support our products and our clients. We're seeing AI led productivity gains across data operations, engineering, commercial and support functions, contributing roughly half of the 270 basis points of year over year margin expansion in Q2. and in the first half we completed the vast majority of actions under our 2026 restructuring program achieving most of the 70 to 80 million of expected run rate savings these are structural efficiency gains with less than one year payback and we believe we've only scratched the surface we're pursuing additional efficiencies across our largest expense areas prioritizing these that carry little to no one-time cost to achieve will remain disciplined, harvest efficiently, reinvest a portion in long-term growth, and expand profitably. As I outlined last quarter, the path from the mid-20s margins into the 30s is fundamentally about flowing durable revenue growth across a largely fixed cost base that we're making more efficient. As a result, every incremental dollar of revenue should carry higher margin than the last. To close, we are doing what we said we would do, and as I've said before in a previous call, we are going to show you that we're an execution machine, driving our core algorithm, expanding margins, raising EPS, inflecting cash flow, and laying the foundation for AI-native monetization and operating efficiency into 2027 and beyond. Thank you to NIQ associates worldwide for delivering a great quarter. I'm excited about what we're building. With that, I'll hand it to Mike to cover our detailed Q2 financials and our raised full year outlook.

Thanks, Jim. And good morning, everyone. As Jim outlined, it was a stronger quarter. Results exceeded our expectations and our guidance across every key metric. Revenue grew 5.8% in organic constant currency. Adjusted EBITDA grew 21.9% and margins expanded by 270 basis points to 23.3%. Adjusted EPS was 27 cents and leverage free cash flow improved by 137 million to positive 74.1 million. Taken together, these results reflect disciplined execution, improving profitability and continued progress toward a stronger balance sheet. Our raised guidance reflects continued strength in our core business. Q2 reported revenue accelerating to 8% growth or $1.1 billion, 5.8% in organic constant currency. This growth came from execution of our revenue growth algorithm. Strong retention, pricing, and cross-selling and upselling with contribution across intelligence and activation. Net loss was $30.5 million while adjusted net income improved by $80 million on a year-over-year basis to $78.7 million. Consolidated adjusted EBITDA grew 21.9% year-over-year to $262 million and we expanded margins 270 basis points to 23.3%. This came from increased operating leverage, as well as AI enabled automation benefits and our 2026 productivity program, making our largely fixed cost base more efficient. From a segment perspective, our largest markets continue to lead the way. America's grew 8.3% on organic constant currency driven by intelligence and cross selling our activation solutions. In the U.S., a global personal care company consolidated its retail analytics work with NIQ, displacing a legacy provider on the strength of our data quality and analytical depth. America's adjusted EBITDA grew 10.5% to 143 million, with margins of 31.4%. Our EMEA segment grew 4.9% in organic constant currency, with the same drivers as we saw in America's. EMEA adjusted EBITDA grew to 26.1% to 179 million, with margins expanding 550 basis points to 35.3%. And our APAC region returned to year-over-year growth up 1.9% in organic constant currency, a meaningful sequential improvement from Q1 and in line with the trajectory we outlined in May. Growth was driven by improving commercial momentum and cross-sell for our analytics and innovation-based activation solutions. as well as improvement in key markets that Jim cited earlier. APAC adjusted EBITDA increased 9.2% to 32 million with margins expanding 120 basis points to 19.8%. So strong results. Americas and EMEA signal competitive strength and APAC is recovering. Outside Americas performance remains solid despite the ongoing conflict in the Middle East. We believe Q2 demonstrates healthy client demand for both our measurement and analytic solutions and any macro backdrop. We believe our top line results demonstrate that our revenue growth algorithm is working. From a product perspective, Q2 was our 10th straight quarter of intelligence revenue growth above 5% and annualized intelligence subscription growth above 5.5% extending our performance track record. As Jim highlighted, annualized intelligence subscription revenue exceeded $3 billion, up 5.8%, and continued strong net and gross dollar retention underscores our mission criticality with our clients. Activation revenue improved for the second straight quarter, growing 6.1% in organic constant currency. Looking deeper across all regions, we've seen low double-digit growth in our analytics and innovation-based offerings. This has been driven by traction scaling our retail analytics wins in Americas, as well as high single-digit growth in APAC. Overall, we see broadly healthy client pipeline for our activation solutions. Looking down the P&L, Q2 operating expenses increased by 5.7%, driven primarily by targeted investments in data coverage and granularity, and to a lesser extent by one-time costs related to our 2026 restructuring program. Excluding these charges, operating expenses grew much slower than reported revenue growth, demonstrating the ongoing cost discipline and increasing operating leverage across the business. One-time restructuring costs totaled approximately $36 million in the quarter. $15 million came from our 2026 restructuring program and that balance from our legacy NIQ and GFK transformation initiatives and one-time deal-related costs. These legacy transformation programs continue to roll off as per plan. As Jim mentioned, we've completed nearly all of our 2026 program actions in the first half, and we're tracking towards a 75 million cost to achieve target for 2026. These actions, which have less than one year payback, are setting us up for increased structural cost efficiency for years to come. From a cash standpoint, we incurred 20 million cash outlay for this program in the first half. We expect the majority of the balance to be paid out in the second half of 2026. This program has less than the one year payback and we expect to continue to identify additional efficiency opportunities as we move forward. Depreciation and amortization was 154 million for the quarter, approximately 14% of revenue in line with prior quarters. But look below the operating line, gap interest expense was 55 million, 40 million lower than the prior year, reflecting lower debt balances and our transformed post IPO capital structure. Changes in foreign currency resulted in a de minimis gain in Q2, compared to a $57 million gain in Q2 of 2025, a period that contained significant FX volatility. The lower gain primarily reflects less foreign currency impact on the re-measurement of foreign currency denominated debt. Income tax expense was $38 million, or approximately 14% of adjusted EBITDA, roughly in line with expectations we provided. The net loss was 30.5 million, primarily reflecting lower FX gains versus Q2 of 2025. Adjusted net income approved by 80.3 million to positive 78.7 million, driven primarily by higher adjusted EBITDA and lower interest expense. Correspondingly, Q2 adjusted EPS came in very strong at 27 cents, well ahead of our guidance and consensus. If I turn to liquidity and free cash flow, as of June 30th, We had 417 million in cash and cash equivalents and 747 million available revolver capacity, resulting in total available liquidity of approximately 1.2 billion. We remain undrawn on this revolver during the quarter. Cashflow from operating activities was 140.1 million versus a use of 8.6 million in Q2 2025. Capital expenditures were 66 million, Reflecting continued investment in strategic growth initiatives such as building our AI capabilities, expanding our technology platform, and growing our data assets such as our omnichannel consumer panels. Leverage-free cash flow inflected positive to $74.1 million in Q2, up $137.3 million on a year-over-year basis, and $197.3 million versus Q1. This is driven by revenue growth and stronger flow through given prudent cost management as well as improved working capital and lower cash interest expense. I'd also note that we saw particular outperformance from net working capital execution versus what underpinned our Q2 guidance in May. Our 2026 is the strong cash flow inflection we've previewed since our IPO and our raised full year 2026 free cash flow guidance implies approximately 300 million of leverage free cash flow generation in the second half alone. This factors into our strong Q2 outperformance from working capital execution and aligns with our broader guidance philosophy of providing expectations we believe we can achieve if not outperform. Net debt was 3.1 billion at quarter end and our net leverage ratio improved to approximately 3.1 times down from 3.4 at the end of Q1. We remain firmly on track to achieve our net leverage target by the end of 2026. And a quick note on capital allocation. Our capital priorities of the business are unchanged. Fund growth, expand margins, and particularly pay down debt. We have successfully reinvested some of our cost program savings to fuel our AI growth strategy and will continue to pursue strategic tuck-in M&A where we see compelling returns. As cash builds, we gain capital allocation flexibility. This is strengthening ahead of expectations in 2026 and positions us well as we head into 2027. We will update you on our 2027 priorities as those plans firm up. Now, before getting into guidance details, a quick reminder about our guidance philosophy. The strong back half and higher full year 2026 outlook is grounded in our first half over performance. If that momentum continues, we expect to finish at or modestly above the top of our ranges. And we've set that range at the level we believe is appropriate. So for the third quarter, we expect reported revenue growth of approximately 4.9% to 5.3%. Organic Constant Currency Revenue Growth Approximately 5.2% to 5.5% Adjusted EBITDA Growth of 15% to 17% Driving Margins of 23% to 23.5% Adjusted EPS of 22% to 24% Our Raised Full Year 2026 Expectations include Reported Revenue Growth of 7.1% to 7.4% Organic Constant Currency Revenue Growth of 5.2% to 5.6% Adjusted EBITDA growth of 15% to 17%, driving margins of 23.5% to 23.9%. Adjusted earnings per share of $1.08 to $1.12, a more than 13% increase at the midpoint. Leverage free cash flow of $245 to $255 million, up approximately $8 million at the midpoint. And we expect to be below three times net leverage by year end. Our RAISE guidance reflects our business outperformance and favorable foreign currency from Q2, as well as our Yimian acquisition. I'll also note that we hit the ground running integrating Yimian into our business and their solutions into our distribution channels. Based on our reported results and our Q3 and full year guidance, our implied Q4 outlook reflects OCC growth in line with our Q3 expectations. EBITDA margin expansion on a year-over-year basis implying approximately 370 basis points of improvement versus Q3 2026, reflecting our typical Q4 revenue and cost seasonality. An adjusted EPS nearly double our Q3 expectation. I'll note that our full year 2026 modeling assumptions remained unchanged. Depreciation and amortization of 614 to 619 million. Gap net interest expense of 230 In closing, it was a strong quarter. We're delivering on our promises. Our financials are strengthening. We're executing well on our core offerings, and we're building additional monetization opportunities on top. With that operator, we're ready for Q&A.

Thank you. We will now begin the question and answer session. Please limit yourself to one question and one follow up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Manav Patniak with Barclays. Your line is open. Please go ahead.

Thank you. Good evening. I just wanted to ask about, you know, just the general trends in the quarter. If you look, I think the intel is for fin growth. remain strong those early activation and I guess the transaction piece of Intel that really did well this quarter so just trying to appreciate you know how much of that pull forward you talked about last time or push forward rather in April and how sustainable these kind of growth rates are and activation maybe for the second half of the year sure Sherman office Jim here we're gonna we'll let Mike take that one right right out of the gate

Thanks. So we're excited about the growth that we saw in both intelligence and activation for the quarter. You know, in intelligence, at 5.7%, and activation at 6.1%. You know, we're continuing to continue to see that momentum build. In particular, when we look at our APAC business, you know, we saw it improved to 1.9% here in q2. And we expect that to continue to contribute Overall growth which will help both on intelligence and activation as that continues to to to grow overall As I highlighted our e-commerce and TPS growth rates are very very strong You know call it north of 30% in terms of the growth rates associated with those two Areas in particular and we should see those continue to move both our intelligence in particular and to some degree activation so We're very excited about it. And as you know, you know, 80% of that our businesses, you know, three to five year contracts, we're continuing to grow that in terms of win backs in the marketplace, as we highlighted in the course of our prepared remarks. And so, you know, we're very excited about what we're seeing in the business. Appreciate the question that you've asked, and we continue to see real good results as it relates to both intelligence and activation.

Okay, got it. And Jim, maybe just on Connect AI, just help me visualize exactly what you're building for clients and perhaps how that gets monetized.

Sure. So I'll give you a little lead in. And we have Troy Trang in here, our Chief Product Officer. I want to make sure you get to hear directly from him. But what we started seeing really later last year and then as we came into this year just being in in conversations with our clients they're trying to figure out how to accelerate their ability to innovate of course how to save money how to do better price and motion how to do everything better than they had before by using all the assets at their disposal and what they clearly understood they need our information and our models inside their world. What we started finding out is they also needed our know how and how to integrate information together. And they were finding this out because they were coming to us and saying, hey, the X integrator needs help. And so these charter deals that you heard us announced are a lot about that. They're about new use cases, by the way, with new budgets inside our clients world where we're helping them do the things that they normally do every day, just better, faster, and cheaper. So I'll turn it over to Troy to give you more color. I think this is a really important thing for us to spend time on.

Yeah, so our Connect AI services are specifically for one of our AI segments. And that AI segment is our AI builder segment that Jim just talked about. So these are a series of clients that want to bring insights and analytics into their environments and use that NIQ intelligence to amplify those workflows. So like Jim mentioned, we announced our first charter clients last week. Karina was the first one that's named, but that group also includes a global personal hygiene company, a leading beauty company and two global beverage companies. We're going to be adding more charter clients to the end of this year, which will include retailers. Each charter client ultimately gets dedicated engineers and data scientists that help make our intelligence work within their workflows. So what this means is they actually help write code and connect their environments to ours. And Jim also mentioned it as remarks that our new products have permission service layers built in this creates additional value and we are the decoder ring and the certified answer for things around our data and our intelligence. And like it was already said, but I'll re say it again demand has come fast 49 live opportunities in the pipeline many more active discussions are in process, and I think soon you'll see retailers and other clients into the mix. And then, on top of that, we also have active discussions on several Ai partnerships to scale this even further. One leveraging for devoid engineers expertise to speed up our development for our solutions that will bring to market, and then we have multiple partners around energetic commerce measurement and touch points and. that product will be launched later this year more to come on that soon so the charter charter phase is all about proving the value and hardening a repeatable model it's deep it's sticky and it's where we see the biggest middle of the long term opportunity in our space thank you thanks love your next question comes from the line of kevin mcveigh with ubs your line is open please go ahead

great thanks so much and congratulations on the results I wonder just given the trends in the organic constant currency growth maybe just talk to activation because it and you know because that looked really good and on the intelligence side too even off a tougher comp you saw real nice re-acceleration is really really important so maybe you can just revisit that a little bit

Kevin, you broke up just a tiny bit in there. I think your question in essence is, tell me about intelligence and activation growth and how you feel about it.

That's exactly right. And even off tougher comps, you saw a real nice rate acceleration. So maybe just a little bit on that because it's just really nice to see that.

All right. So appreciate it Kevin it's Mike I mean we look at intelligence and I mentioned, you know we saw the rebound associated with a pack at the 1.9% growth and and. One of the things that we did, and we mentioned this a bit in Q1 was we you know improved our coverage we we signed up a couple more retailers. That we that we specifically talked about in Q1 and we're starting to see that you know starting to pay off and see it in the growth that we're seeing in intelligence. And in in you know we're we're continuing to win in the marketplace those those are continue to add and, as I had mentioned. You know a little bit during my prepared remarks and to my last question when you look at. Really what's been happening in ecom and and our panel on demand has just been really been very attractive to the marketplace and i've been growing. At plus 30% so all those are contributing to our intelligence growth and and we're continuing to see that happen on the activation side, you know people are very interested in our analytics solutions in particular. And our AI basis screener is just one example that's happening in our basis portfolio as well. So as I said, in my comments, both of those business lines are growing at greater than double digit overall. And so the demand has been very strong for activation. So you know, that's what we're what we're seeing, you know, overall, Kevin, and we're very excited about what's happening in both of those areas, and as well as what Troy had mentioned previously.

Super helpful. And then just real quick, as you're facing in AI, any way to think about where it is from a geographical perspective in terms of just coverage and how we should think about that over the balance of the year?

So you're talking about like maybe where is the most initial penetration? Is that fair? Yeah, yeah, that's exactly right down. So yeah, for sure. For sure. It's in the US, right? but not exclusively at all to the US. I think the bigger, more like at our C360 conference, which is mostly a US based conference, the theme both formally and informally in our little conversations is our clients like help us move faster. We see what you can do. We like what you're doing, what you told us on stage. How can you help me move faster internally to navigate what I've got to navigate to use these AI tools, not only on your data, but your data combined with our data. So I think they're much more in a position, as Troy said, with the builder. There are builders, and they're in a position to move quickly, but the pipeline is there in Western Europe for sure, in Asia for sure, even EMEA, because these tools work, and our data is primed to be able to be used to take advantage of it. It's not just in our builder products, but it's also in, you know, our optic products within discover, and we're releasing some new capabilities yet this month, that people are going to be able to take advantage of if they so choose, and we believe they will. So it's really broad based, the whole world is dealing with AI, as you know, but as far as the charter, things that we talked about, it's that's primarily us, but Pipeline has plenty of global opportunities as well.

Super helpful. Congrats again. Alright, thanks. Thanks Kevin.

Your next question comes from the line of Alexander Hess with JP Morgan. Your line is open. Please go ahead.

Thank you operator. Hey guys, wanted to maybe just dive into something maybe to start with. The call outs that, you know, CPS, which I understand is the consumer panel business, and then Ecom grew north of 30%. You know, it's intelligence growing in the mid single digits. Does that imply, you know, you have products in sort of traditional measurement and in, you know, retail analytics that are maybe growing below that number or notably below that number? Or is that just not the right way to think about it? Just Just want to clarify how you guys bucket that call out specifically.

So the core business, what we call our RMS business is primarily in intelligence. I think the number is the number there. And of course, CPS and Ecom are portions of it that are growing faster. But as a percentage of the total revenue, They're much smaller, right? And so I wouldn't think of it that way, Alex. I would say that the number you're seeing kind of stands on its own and it reflects what I believe is a good, healthy, recurring revenue stream. And I'll just remind you that none of that number, you know, while there's a little RAI-based revenue in that number, none of our guidance forward is really reflecting that yet. We're being cautious to see how fast

this stuff is taken up but that will just we consider that intelligence revenue by the way for the most part that will just take that number up awesome and then can you give us an update on a full view measurement client count any recent traction obviously you guys put out some press releases about integrating some more Amazon 3p data in certain categories but just Anything on full view measurement in 2Q and your outlook for beyond 2Q?

Yeah, so I don't have the exact number in front of me, but we know that it's more than 200 clients now have taken up the full view measure. And that strategy, which we've embarked on five years ago, is much more expansive than just Amazon sales and share or Costco or what whatever and so strong it's the foundation of what we do not only driving you know we're getting more adoption but it also helps us with our you know our annual renewal cycle and it's proving to be quite good I think the insight behind that question is we have our foot in that world and it's important that we always have what we call the full view. So the most holistic view of this consumer shopping behavior. If we lose that, we lose what is the essence of who we are. That is what enables AI. So if we have our foot in the other world firmly now, I think trying to demonstrate that the full view plus these AI capabilities that are going to keep us super relevant to our clients and also allow us to grow. And our root of that is we're now in more Even more use cases. I think there was a theory will be in less. No, we're in more use cases. And they're obvious use cases now. And we're also kind of getting access to more budgets within our clients. So we're not arguing over the same dollar. So I like to talk about both those things together now. And we do have many things to enhance.

And we do have multiple product enhancements that are coming for full view measurement. You referenced one like three. There's many more coming in the back half this year.

Your next question comes from the line of Kyle Peterson with Needham. Your line is open. Please go ahead.

Great afternoon and nice result. uh i want to start off on uh the data consumption disclosure i think it's a plus 25 year to date um yeah that's really good to see i guess how can we think about this over the medium term you know is this something that drives higher consumption across the product base and then pushes revenue higher or you know is this like a more highly correlated things with ai products and just trying to i guess uh Ordinary Shares Ordinary Shares Ordinary Shares Ordinary Shares Ordinary Shares

The more depth in the data or breath, I should say in the data, the better any tool is going to work. And so they continue to use discover and it's, let's say the more traditional analytics, which are quite powerful, but they are also experimenting in some cases are actually doing in some cases and using our data points inside their world that they're sophisticated enough to do that. So I think it's an overall measure of how our relevance continues to grow within our clients. And I don't know if we measured that thing that far in the past, but I can tell you that that number hasn't been that high. So I think it's just showing how in the double digits or kind of high double digits, I think you'll see that trend continue because it's like this insatiable demand And as they're seeing their results get better, especially combined with some of their own, you know, assets only they have for themselves with our data at a granular level. They're seeing that they can make pretty profound changes either making themselves more cost efficient or innovating more quickly and driving the top line.

Right. That's really helpful. And then I guess if we could switch gears over to kind of how some of your client conversations are evolving. Are you guys seeing any change or growth in budget for demand-based solutions, maybe away from traditional marketing or kind of SKU-based placement? Obviously, it seems like agent of commerce and uh data you know based product development decisioning is definitely becoming increasingly prevalent so i guess like how are you is that playing out at all in your kind of client discussions and you know so how is that potentially translating into uh field conversion or uh demand yeah so yes for sure and i'll i'll just give me a chance to mention um irena stoian that that we

just recently brought in, she's the word for Palantir, doing a lot of the same things she's going to work with us on. And that's a direct reaction slash anticipation of the demand for what's now being called forward deployed engineers, but engineers who are in our clients world, helping them use our core services in new ways, integrated with theirs. So that conversations are new, there are new budgets, I've been in many but Troy has been in even more than I have. Maybe Troy, you can elaborate on one or two.

Yeah, so you know, it is a different client base. So typically, it's not the market research teams that are that are using these types of resources that definitely comes from the chief data officers, chief technology officers. And that's what these products, these this whole series of connect as services with the deployment plan around it is is intended to go after. Completely different, like I said, completely different budgets. They're enabling multiple different workflows throughout a client's organization, and that's the untapped demand that's been talked about a lot here today. Excellent.

Thank you, guys. Nice results. Thank you.

Your next question comes from the line of Andrew Nicholas with William Blair. Your line is open. Please go ahead.

Hi, good afternoon. I wanted to ask about AI as kind of a benefit to the data assets that you have specifically. I hear you on the productization piece, the efficiency piece, and the sensational demand from clients. But is the product or I guess the data estate that you have being augmented by the technology, are you able to gather more information, more detailed, more attributes? I would imagine that would be beneficial long term as well and hoping you can speak to that specifically.

Yeah, so you hit on one of the core key strategies here. So when you when we talk about these AI set of components, there's there's four buckets of product capability that we have beneath it. So one of them is all around which you referenced the last second here was a premium AI ready data solutions. This is all about collecting data faster and coding and characterizing them faster, getting more breadth and depth. And I think a couple of questions ago, we talked about, you know, a full view measurement and that's how you expand out to, you know, even 3P coding that was referenced in some of these other things. You can do it at faster scale and get more breadth and depth of characteristics and facts around the data sets we have. The more you get, the more AI tools can filter and do correlations and causations on on consumer response and sales and all the things you can imagine. The second tier is all of the series of services that use those data attributes to help harmonize and enrich data within their environments. So we combine those characteristics and further enrich. So that's the second part where AI comes into play because it can do it at faster scale, whether that's using web content or other sentiment data that exist. bring those in and can add it to the product and then the third which we talked about that we put it in our applications and solutions like the optic bridge cadence connect AI services and then lastly it's the AI deployed engineers and data scientists that sit on top that we just mentioned in the last in the last question so it's all four of those things coming together to create and optimize a workflow and that's the end-to-end product design

Very helpful. Thank you. And then for my follow up, a few well, a multi part question maybe on margins. I guess first, Mike, is there anything you can say about what was realized in terms of synergies in the second quarter and then in EMEA in particular, like a really, really nice step up year over year? It looks like that margin profile is higher than than the other two segments. So if you could just speak to the strength there, the drivers and any reason for that to be structurally higher than U.S. or APAC long-term, or I should say Americas or APAC long-term.

Sure. So on the overall margins, up 270 basis points, you know, the 23-3, when you look at it, really the 26 restructuring actions, the flow-through that we had had on the NIQ transformation in aggregate, those drove about half the improvement in margins, and the other half then has come from the revenue growth on our on our fixed cost base roughly 80 percent of our costs are fixed and you're you're getting that margin flow through to that 23 3 overall that we had for the quarter and embedded in that is emea or emea at that 550 basis points improvement we've continued to you know manage our cost base effectively in that market which has been a key View of us overall for the company but specifically that it being our largest You know business and and and therefore we've been very focused on managing that team has done a great job in terms of managing costs Overall, the other thing I say there's a little bit of timing that's happened in our activation solutions there just in terms of the cost associated with the variable costs associated with those projects and Just a little bit of timing that that's benefited us in Q2 overall. So hopefully that gives you some insight to it. But as you did see, we did raise our full year guidance on our margins as well.

Yes, thank you.

Your next question comes from the line of Curtis Nagel with Bank of America. Your line is open. Please go ahead.

Okay, great. Thanks. First, kind of a more short term question than a longer one. First, just would you be able to clarify just how much of the cash restriction costs you'll bear in 3Q and the free cash and just how to think about the flow, you know, from 3Q to 4Q? Just want to make sure we get, you know, the puts and takes there, right?

Yeah I mean if if just if you look at the cash spend you know that happened uh Kurt as it relates to the programs there was 28 million in Q1 and 24 million in Q2 um you know I would say that 50 million the rough spend that's that you're looking out over the rest of the year think about 70 of that's probably going to land in Q3 in terms of thinking about the numbers okay very good uh and I guess just the the next one just thinking about uh and I think you'd mentioned in a potential scope for

more AI efficiencies in the call space. I just kind of think about long term and how much quicker does that potentially pull you to your above 30 EBITDA target margin range?

Yeah, so this Jim. I don't think we put an exact time frame on the above 30. But we do have line of sight to it. And it's definitely driven by The continued understanding, practical understanding and use of AI among other efficiency programs within our company. But AI is a big part of it and it makes sense for us as you can. It's kind of logical. We do a lot of work with data and the more we automate that, the cheaper it's going to get or the more we use AI. Let's call it to do things. It'll be faster and cheaper. We write a lot of code. So the more we use AI, the more we're going to be able to write code faster. And then we do have a people heavy company where a lot of the things that we do can be made more efficient through the use of AI, whether it's customer success or even the administering of the sales process itself or HR and hiring and keep going on. It affects every part of our business. We're in the very early innings of taking advantage of that. It's already shown up, as you've seen, in some pretty juicy jumps in our EBITDA margins. I don't think we've exhausted anywhere near our ability to generate more margin going forward.

Okay, very clearly. Appreciate it. Thanks, Jim.

Your next question comes from the line of Shlomo Rosenbaum with Stifel. Your line is open. Please go ahead.

Hi, thank you very much. I want to focus a little bit more on the cash flow. The cash flow clearly did well, actually crushed it. And for the rest of the year, you're talking about another 50 million of cash restructuring payments in the second half, yet still generating 300 million of free cash flow. If I'm thinking about the business in a longer term how much can you quantify the total what you would call one-time ish cash payments that are going to be absorbed in the guided free cash flow that we should not see on a regular basis so I mean the 248 255 that is is that with these restructuring payments without the restructuring payments and how should someone be thinking about the cash flow when I move into 27 because pretty strong even with a bunch of these one-time-ish stuff.

Yes. So Shlomo, the numbers that we guided to for the full year include those payments in those numbers overall, which just to remind back is $300 million over the second half of the year. We increased it as part of our improved guidance for the full year by roughly $8 million. in terms of delivering it and does capture the spend associated with it. Look, I right now, you know, we're continuing to drive our one time items down. You know, that that's been our stated goal and consistently and going back to our overall capital, you know, allocation view, which is first is make sure we're paying down our debt, and they were getting it below three times. And that's generally, you know, from the from that cash, Ordinary Shares Ordinary Shares Ordinary Shares Ordinary Shares Ordinary Shares You know, I think it's just a prudent thing to do. So, you know, we're going to continue to evaluate those types of items. So I think it's difficult to say with any certainty at this point, you know, we'll talk about 27 when we when we firmed up those plans to it. But we're going to be smart, you know, about it. And we've had a people intensive business and, and we've got great people, but we get, you know, we may not need as many. And so as we have turnover, we may not be filling those those spots in terms of thinking about it going forward. and um and so you know not all actions carry otis and and so that's what we'll continue to to evaluate so i'm trying to give you as much color as i can shlomo in terms of thinking about it hopefully that's that's helpful okay thanks and then just what i'm trying to uh bridge and think about the uh the guidance versus the last quarter on the revenue side just in general

how much of the guidance changes FX versus how much is the you know the acquisition that you've made it looks like you raised the organic by 20 to 30 basis points but beyond that could you give us a little bit more color so we can kind of track FX changes so you know the FX impacts you know when you look at Q2 where we're

not that is not you know obviously we're way down from where if you looked at it in the prior years i mean q2 america's you know impact from fx was three percent enia was two percent apex was basically flat um you know so there were pretty really minor fx impacts in q2 and and right now based on you know when we're looking at the forward rates we don't see a big fx impacts you know really through the rest of the year um as opposed to q2 of 2025 when it was Your next question comes from the line of Jason Haas with Wells Fargo. Your line is open. Please go ahead. Hey, good afternoon and thanks for taking my question.

I'm curious if you could give us a sense for what percentage of your data is now available for MCP consumption and what is the pricing model look for that? Are you charging customers more for access to the data via an MCP? Is there a consumption based pricing model there? Can you just unpack that a bit? Thanks.

Yeah. So we're all this, Jim, we'll start with pricing. We're going to be experimenting with several different kinds of pricing models. Some are consumption based, some are not. And I think that's as far as I'll probably take that one right now because I'm sure we'll be explaining to that more and more as we learn. But we know the demand is there and that's part of these charters that we're doing. They're just the beginning of an engagement with these clients to see how much value we're creating inside their world, which we believe is going to be very meaningful and big time for us.

I don't know if you want you want to give more about the actual data that's touchable yeah so um our product for MCP consumption that's optic bridge that's the product that we announced at c360 it's being launched in full you know kind of product mode here at the very beginning of September with our official launch we're in beta right now the data that's in there is primarily us in beta mode but we have releases scheduled throughout the rest of this year to get all of our retail measurement around the world and also our consumer panel data as access through that through that mechanism. So that is that's part of the product launch like I said in in early September and then you know continue to have releases every few weeks with with the goal to get ultimately all of our data assets set up through the core platform but across the NICU.

Okay that's great to hear and then as a follow-up it sounded like you teased product that's going to track agentic commerce measurement. I think it's what you refer to.

Can you explain what that is?

I'm trying to envision when consumers shop agentically, how are you going to go about collecting that data?

Thanks. So, yes, we will. I think you guys know agentic commerce is an emerging channel. We measure the market. So we we will be having products that will be launching here that cover that channel as a like it is just another channel within that though we're also going to measure share share of prompt share of discovery will also have. share of accuracy of those results clicks and then ultimately conversion so that's the product I guess I teased a little bit more to come shortly. Okay, we'll look out for that Thank you.

Your final question comes from the line of Jeff Mueller with Baird. Your line is open. Please go ahead.

Yeah, thank you. Can you just go into more detail on the retail and monetization opportunity? My understanding is that historically it's been more of a value exchange and you're getting data so you're monetizing the retailer side of the equation less but is that changing because there's an opportunity for you to provide significantly more value for them through the AI solutions and other things you've been doing as part of the transformation yes so the short answer is yes and it's not just AI it's the consumer panels it's

other data sets that we don't necessarily you know highlight in these calls but as they're trying to build their own let's say right to win and agentic commerce they're seeing the value of having the kinds of information we have about characteristics of products understanding consumers better and you know these are the big big players um where there has been more of an exchange i think is what you're calling it of trade embargo or whatever you want to call it but we also are seeing good engagement with mid-sized to smaller players who are also going to be able to make use of our tools so I think our value with these clients is just increasing just like they are with the CPGs and the tech and durable guys um based on the kinds of data we have and now the more use cases that they uh that they can apply it to and I you know genetic commerce is still figuring itself out, but we're right in the middle of that. And we're kind of learning with them as we go. And our conversations now are much more strategic versus transactional. And then they're saying, wow, I didn't realize you could do this, this, this, this. And so that's driving more penetration in in almost every retailer.

Got it. And then on the AI monetization strategy, I get that it's going to be evolving, and you're going to be experimenting and You're focused on driving adoption. Is there some sort of like on these like early adopters? Is there some sort of like short duration trial period where they're capped on volumes or there's heavily discounted pricing and then at some point in 27 it flips to more normal monetization levels or how should we think about that?

Well, We're very, very concerned, I guess we're not not threats. We're very interested though, that's the right word, in ensuring that they do use the tools, and they do see the power and the tools right away. And not getting somehow caught up in some of the way the the LLMs are doing their thing, which are scaring folks and using too many tokens, or whatever, right. So our experimentation is at first saying is it generating the value for them and then we have various ways based on all the different kinds of work we do with them anyway on contracting negotiations or otherwise or we can say if you want to continue using these kinds of tools of course there will be a compensation for us for you to use them and so that's the way you should think about the consumption based and then that comes really in two ways one is using it online and transacting or having access to our information through let's call them APIs where they can get out our data but then they pay for it for that particular use case for that particular point in time got it thanks Jim yep you're welcome

There are no further questions.

Okay, great. Well, thank you all for joining. It's been about a year now since our, our IPO and certainly the world has changed quite a bit. And I think we have anticipated some of it reacted to some of it, but you're seeing it not only in our results financially, but in the way we're able to talk about our business with real world examples of what we're doing to serve our clients in this world where we're providing both the full view This concludes today's call. Thank you for attending. You may now disconnect.